- Special share dividends =  7.1% yield (10.7sen) based on proposed 1 for 14 treasury share distribution and last price of RM1.50. Total dividends for the year work out to 11.7 sen (including 1.0 sen for final dividends) or 7.8% yield.  However, we do note that this is a one-off event. 

- 9M12 returned to the black at RM7.7m net profit and is considered within expectations  (refer to 17/5/12 NOT RATED report). We are expecting a stronger 4Q12 given better property billings and significantly stronger leisure revenue.  

- i-City projects see strong take-ups over short period. iResidence Phase 1 is  fully taken up. Phase 2 has been launched in Aug-12 with 'promising' take-ups. i-City's SOVO (GDV RM64m @ RM500psf) has been fully booked since the launch. Upcoming launches include i-City SOHO (GDV: RM317m @ RM600psf).

- i-City GDV revised up by 66% to RM5b based on higher ASP of RM600psf vs. previous GDV RM3b (ASP of RM400psf).  Main reason is that iBhd entered into a MoU with Central Pattana Public Company Ltd (Top Thai retail developer and manager) to form a JV to develop a regional shopping mall in i-City (1m sf NLA) by 2015/16; without an equity JV, the mall's cost of RM500m will be taxing on its balance sheet, albeit its net cash position. Succesful JV will be a strong re-rating catalyst for i-City projects' takeup rates and capital values.

- Leisure income much stronger than expected as FY13E leisure revenue (e.g. Digital Lights, SnoWalk and etc.) may hit c.RM50m (intial estimates RM31m). Another RM45m CAPEX is expected (current CAPEX: RM55m), to expand leisure content over the next 3-4 years, translating to 20% YoY leisure topline growth. Hence, increase FY12-13E earnings estimates by 6%-36% to RM12.0m-RM33.0m. 

- Higher TP of RM1.97 (RM1.51 previously): Our NOT RATED report  dated 17/5/12 valued i-Bhd at RM1.51 based on 65% discount to SoP RNAV of RM4.32 (DCF of future profits based on GDV of RM3b or RM400psf). We revise up the SoP RNAV to RM5.62, assuming a conservative average ASP of RM550psf (vs. RM600psf  guidance), which translates to GDV of RM4b. Assuming the same discount rate of 65% (15%-75% discount for developers under coverage) given its illiquidity, small market cap and concentration risks, we derive a valuation of RM1.97. iBhd is trading at FY12-13E core PER of 14x-5x, which will be a record low PER for the company.  

- Resistance:RM1.57 (R1), RM1.66 (R2)

- Support: RM1.43 (S1), RM1.28 (S2)

- Comments:Having broken out of the bullish 'Pennant' formation earlier last week, i-Bhd's technical picture has improved significantly. Look to buy on weakness with a technical target price of RM1.88. A stop loss should then be placed just below the 'Pennant' support at RM1.26.

- I-Berhad is an investment holding company that manufactures household electrical appliances. It is also the master developer of i-City @ Shah Alam. The company develops, manages and invests in i-City, which spans 72ac in Shah Alam alongside the Federal highway. It enjoys MSC status and is one of  the few large freehold land banks in Shah Alam. i-Bhd has signed an agreement with the State Government of Selangor for the development of i-City as a Technopreneur Campus for 21 years. Incentives granted to the company include 1) Temporary Occupation License for c.30ac of neighbouring land; 2) approved 24 hours operation for approved outlets; 3) a lower Bumi sales quota of 30% and 4) an increased plot ratio of 5.0x from 3.0x, which nearly doubled the allowable GFA to 13.0m sf. The project enjoys strong accessibility and will soon see a flyover interchange with direct and exclusive access to Federal Highway as well as an LRT extension to service i-City. 

- Property Development, Property Investment, Leisure (comprising of entertainment components like the City of Digital Lights, Outdoor Fun Park, SnoWalk, Water World and i-Walk)  and ICT Services.  

Source: Kenanga